Candidates, political party committees and interest groups all raised and spent more money in 2007-08 than in any previous election cycle, according to a major new report from the Center for the Study of Elections and Democracy (CSED) at Brigham Young University. The report, The Change Election: Money, Mobilization, and Persuasion in the 2008 Federal Elections, is the complete summary of a CSED research project involving twenty academics and scores of other observers on the ground in five key presidential battleground states that also had competitive Senate or House races.

“Due to charismatic candidates, motivated donors, and creative uses of the Internet, Democrats have erased the Republican advantage among individual donors and clearly surpassed them in raising money in both large and small amounts,” said David B. Magleby, editor of the CSED study and principal investigator on the project. Overall, Barack Obama spent $730 million while John McCain’s fundraising in 2008 reached $346 million, only slightly behind Bush’s total fundraising in 2004 of $367 million. In 2008 the Democratic campaign committees for the Senate and House together outraised the Republican congressional campaign committees by over $125 million, and nearly four million people contributed money to the Obama campaign””more than twice as many as had donated to any candidate in the past. The increased use of the Internet for fundraising ironically is often identified with John McCain’s 2000 campaign, in which he was applauded for raising $5 million online. Interest groups like MoveOn.org and the Howard Dean presidential campaign in 2004 expanded the use of the Internet. Congressman Ron Paul’s presidential campaign in 2008 also had notable success using new technology. But as the CSED study documents, the Obama campaign far exceeded any other campaign in the use of the Internet. As Joe Trippi, who was closely identified with Howard Dean’s 2004 expanded use of the Internet, explained to the CSED researchers: “the technology”¦everything was better”¦it’s like the Dean campaign were the Wright brothers, the Obama campaign was Apollo 11 and we’ve skipped Mercury, Gemini and everything in between.”

Presidential candidates of the future will be studying the Obama campaign and one lesson learned will be to try to build a wide base of donors at all levels so the candidate can bypass public financing with its associated spending limits. Observers interviewed for the CSED study were all of the view that Obama’s money advantage helped him achieve a much more extensive voter mobilization and “field” operation while still outspending McCain and the RNC on television and radio. The Obama money advantage also allowed him to compete in states that based on recent elections should have been predictably Republican, like Indiana and North Carolina.

“For Democrats to be able to substantially outspend Republicans in a race for the White House or overall in congressional contests has hardly been the norm,” noted Magleby. For the second cycle in a row the Democratic Senatorial Campaign Committee (DSCC) raised and spent more money than the Republican Senatorial Campaign Committee (NRSC). Raising money from individuals was again key to the Democrats’ success. In 2008 the DSCC received $26 million from large donors and $24.7 million from small donors, while the NRSC received $12 million from large donors and $29.2 million from small donors.

The DSCC targeted its spending of this money to competitive races. For example, in the Colorado Senate race between Democrat Mark Udall and Republican Bob Schaffer the DSCC spent over $4.6 million in independent expenditures as well as contributing to the state party’s coordinated campaign. Other targeted races include New Mexico, Minnesota, and New Hampshire.

The NRSC also targeted its money to competitive races but faced difficult choices in where to deploy its resources. For the most part the NRSC was playing defense in 2008, with only one or two Democratic incumbents seriously challenged. The NRSC also faced the reality that the Democrats had the more expansive voter mobilization program and that the Republican Party could not deploy field operatives to as many races as needed to counter this Democratic advantage.

Another substantial change in 2008 was the substantial drop in fundraising by the National Republican Congressional Committee (NRCC) at the same time the Democratic Congressional Campaign Committee was catching the general Democratic wave of increased individual contributions. The DCCC advantage over the NRCC was about $58 million, and made a difference in races like the Ohio Sixteenth District, where the DCCC spent $1.5 million in independent expenditures in behalf of John Boccieri and in the Colorado Fourth District race, where the DCCC spent more than $1.1 million in independent expenditures as well as $225,000 in the coordinated campaign in Colorado to support Betsy Markey against her opponent Marilyn Musgrave.

The Democratic money advantage in 2008 meant they could outspend the GOP on television, radio and on the ground. The CSED study documents the difference this made in key battleground states. But the Obama campaign had the a far more expansive ground game using volunteers, paid field staff and technology to identify likely supporters and involve them in the campaign. The CSED study demonstrates that Obama’s ground game helped other Democrats running in competitive Senate and House races in 2008.

Far more Americans in 2008 cast their ballots early or through the mail rather than in person on Election Day. The CSED study examines the surge in early and absentee voting in many states. Obama’s better organized and much larger voter mobilization efforts helped him get what campaign professionals call “lower propensity voters” to the polls early or to cast their ballots through the mail. Obama won the early vote by a substantial margin in states like North Carolina where early voting as a whole was up from 31% to 61%.

American federal elections, the CSED study demonstrates, are best understood as a team effort involving the candidates, allied political party committees and interest groups. While McCain did not come close to matching Obama’s fundraising, when the spending by the Republican National Party on his behalf is added to his spending he comes much closer to Obama and the DNC. Party committees were especially important in competitive congressional races, the CSED study finds, and there was less activity by Section 527 groups compared to 2004, when groups like Swift Boat Veterans for Truth, Progress for America, the Media Fund and America Coming Together were active. Both Obama and McCain urged people not to give to 527s, and fines levied on some of the groups after 2004 may have discouraged the activity. More liberal groups also recognized that Obama had ample resources with which to communicate his message and mobilize the vote. While Section 527 activity was down in 2008, Section 501(c) and PAC spending in federal elections was up. Overall interest groups spent more in 2008 than in 2004.

When campaign finance reform took effect following the 2002 election cycle, some observers wrote that banning the unlimited individual and interest group contributions to political parties was a “suicide bill” for the Democrats. Democrats had come to rely on party soft money contributions more than Republicans had, and they had not developed nearly the Republicans’ network of small individual donors. Cultivating a set of committed individual donors is expensive and takes time, especially when the primary mode of raising money is by telephone or through the mail. The Bipartisan Campaign Reform Act, or BCRA, gave candidates and party committees incentives to focus their fundraising on individuals by doubling individual contribution limits to candidates and by increasing nearly fourfold the overall contribution amount a single donor could make to federal candidates and committees. BCRA also provided for these limits to be adjusted for inflation, bringing the 2007Ã³Ë†´ aggregate contribution limit to $108,200. But for individuals who want to “max out” their donations in an election cycle, only part of that total ($42,700 for 2008) can go to candidates, meaning party committees have an incentive to raise money from individuals, who may divide the remaining $65,500 among party committees and political action committees (PACs).